It is necessary for the functioning of the federal workplace relations system that officers and employees of registered organisations abide by the rulings of the system's institutions. Unfortunately, there have been some instances of blatant disregard for orders of the Australian Industrial Relations Commission and the Federal Court.

Violations of court and commission rulings include instances where the commission has ordered that industrial action cease or not occur, and instances where the Federal Court has issued injunctions to enforce orders to stop industrial action. In a number of cases, those disobeying the orders have gone entirely unpunished for their failure to comply.

Failure to punish law-breakers encourages law-breaking. If such behaviour goes unpunished then it is likely to be repeated.

The government believes that further enhancements to the legislative framework are required to ensure that the integrity of the system is not undermined by failure to comply with court and commission rulings.

The Workplace Relations Amendment (Compliance with Court and Tribunal Orders) Bill 2003 will amend the principal act to provide more effective sanctions against those who flout the authority of the Australian Industrial Relations Commission and the Federal Court. Whilst noncompliance is concentrated amongst unions and their representatives, the provisions of the bill will also apply to employer organisations and their officials and employees.

The bill will establish duties on officers and employees of registered organisations to comply with orders and directions of the Australian Industrial Relations Commission and the Federal Court. Where those duties are breached, the minister can seek orders from the Federal Court that financial penalties be imposed. Where court orders are breached, these new powers do not affect the existing powers of the court to deal with contraventions of its orders and directions.

Officers and employees of registered organisations who are fined by the court for failing to comply with court and commission orders would generally be disqualified from holding office in registered organisations, under provisions contained in the bill. Registered organisations and their representatives have significant rights and privileges conferred upon them by the Workplace Relations Act, but with those rights come significant responsibilities. Those who neglect their responsibilities by wilfully or recklessly disregarding the authority of the commission or the court should not, in most circumstances, retain the privilege of being able to exercise authority as an officer of a registered organisation.

The bill provides flexibility in the application of sanctions. Office holders and prospective office holders found to be in breach of their compliance duties will be able to apply to the Federal Court for leave to hold office. For the purposes of exercising this power the court would have to consider a number of matters, including the circumstances of the contravention and the nature of the person's involvement in the contravention. The bill would also safeguard an organisation from financial damage suffered as a result of an officer or employee of that organisation contravening their duties, where the court is satisfied that the organisation took reasonable steps to prevent the contravention.

The Commonwealth has a duty to the community and the national interest to ensure that its laws are respected and upheld, particularly where this may prevent unlawful industrial action which threatens business performance, international competitiveness and jobs.

On 19 December 2002, I announced that the Commonwealth would take a much more active role in taking legal action and pursuing penalties against people and organisations that fail to comply with Federal Court or commission orders in workplace relations matters. The government will make full use of existing laws to seek penalties where there is compelling evidence that a person or organisation has defied orders and it is in the public interest to take the legal action. The government will take contempt of court action where Federal Court orders, and in particular orders against industrial action, are defied. The government will use existing law plus the measures in this bill to seek penalties against parties who fail to comply with return to work orders of the commission or other orders designed to ensure the effective operation of the workplace relations system.

In appropriate cases, the government will refer cases of failure to comply with return to work orders of the commission to the Director of Public Prosecutions for prosecution for `contempt of the commission'. To that end, I foreshadow that I will be introducing legislation to codify section 299 of the Workplace Relations Act so that all conduct that amounts to `contempt of the commission' is expressly identified. These amendments will also bring the maximum penalties into line with Commonwealth policy for offences of this kind. Complete codification of the offence will provide enhanced certainty and will complement the provisions contained in this bill.

The government believes that registered organisations and their representatives should act in a responsible manner and respect the rule of law.

The proposed measures will increase confidence in the system. They should also reduce the harm to business, jobs and the economy associated with defiance of the workplace relations law and its guardians.

I commend the bill to the House and present the explanatory memorandum.